Contract Law - CONTRACT FORMATION Questions With
Accurate Answers.
What elements are needed to create a legally binding contract? - accurate
answers-
How does the court determine whether a contact has been formed between
parties when there is an issue on intention? - accurate answers-what a
reasonable person would say was the intention of the parties, having regard to
all the circumstances.
What is required for a valid offer? - accurate answers-
What are the two types of contracts that can be formed? - accurate answers-•
Bilateral contracts are a contract between 2 people. Each party assumes an
obligation to the other party by making a promise to do something, such as to
sell an item to the other party in exchange for a payment
• Unilateral contracts are a single contract. One party makes an offer or
proposal in terms which call for an act to be performed by one or more
parties. Completion of the prescribed performance will be acceptance of the
offer
What are the effects of a counter offer + request for further information? -
accurate answers-• If there is a counteroffer, it extinguishes the previous offer
and asserts the counteroffers terms. The last person who asserts their own
terms in a counteroffer is likely to prevail.
A request for further information is not a counter-offer, and the original offer
remains open.
How can an offer be terminated? - accurate answers-(1) rejection (doesn't
take place until communicated to the offeror),
(2) revocation - the offer can be revoked at any time before acceptance.
(3) death of offeror or offeree
(4) lapse of time (prescribed time in offer or reasonable time)
(5) Counter offers
, Can an offer be revoked by a third party acting on behalf of the offeror? -
accurate answers-yes, it can be revoked, unless the offer is a unilateral offer
and the offeree has already started performance
If an offer is revoked by post, when is it deemed effective on the offeree? -
accurate answers-effective the moment it's received by the offeree, not when
it's read.
Can a unilateral offer be revoked? - accurate answers-cannot revoke if offeree
has already started performance for unilateral contract
What are the legal effects of invitations to treat and what are the different
types? - accurate answers-Invitations to treat cannot be accepted to form a
binding offer. Broadly, these include:
1. Advertisements
2. Display of goods - Fisher v Bell: goods displayed in shop windows are
invitations to treat only.
3. Invitations to tender
4. Auctions
5. Websites displaying goods
What are the four rules in relation to acceptance? - accurate answers-(1)
Acceptance must be in response to the offer.
Only the person / people to whom the offer is made can accept the offer.
(2) Acceptance must be unqualified and must correspond exactly with the
terms of the offer: the mirror image rule.
(3) Prescribed mode of acceptance
(4) Acceptance must be communicated. The general rule is that acceptance is
effective from the time its communicated to the offeror. Where the offeree
merely intended to accept, but did not communicate that intention to the
offeror, there is no contract.
Q1. In situations where the offeror exclusivley prescribes a mode of
acceptance and excludes other mdoes, how will this effect acceptance of the
offer?
Accurate Answers.
What elements are needed to create a legally binding contract? - accurate
answers-
How does the court determine whether a contact has been formed between
parties when there is an issue on intention? - accurate answers-what a
reasonable person would say was the intention of the parties, having regard to
all the circumstances.
What is required for a valid offer? - accurate answers-
What are the two types of contracts that can be formed? - accurate answers-•
Bilateral contracts are a contract between 2 people. Each party assumes an
obligation to the other party by making a promise to do something, such as to
sell an item to the other party in exchange for a payment
• Unilateral contracts are a single contract. One party makes an offer or
proposal in terms which call for an act to be performed by one or more
parties. Completion of the prescribed performance will be acceptance of the
offer
What are the effects of a counter offer + request for further information? -
accurate answers-• If there is a counteroffer, it extinguishes the previous offer
and asserts the counteroffers terms. The last person who asserts their own
terms in a counteroffer is likely to prevail.
A request for further information is not a counter-offer, and the original offer
remains open.
How can an offer be terminated? - accurate answers-(1) rejection (doesn't
take place until communicated to the offeror),
(2) revocation - the offer can be revoked at any time before acceptance.
(3) death of offeror or offeree
(4) lapse of time (prescribed time in offer or reasonable time)
(5) Counter offers
, Can an offer be revoked by a third party acting on behalf of the offeror? -
accurate answers-yes, it can be revoked, unless the offer is a unilateral offer
and the offeree has already started performance
If an offer is revoked by post, when is it deemed effective on the offeree? -
accurate answers-effective the moment it's received by the offeree, not when
it's read.
Can a unilateral offer be revoked? - accurate answers-cannot revoke if offeree
has already started performance for unilateral contract
What are the legal effects of invitations to treat and what are the different
types? - accurate answers-Invitations to treat cannot be accepted to form a
binding offer. Broadly, these include:
1. Advertisements
2. Display of goods - Fisher v Bell: goods displayed in shop windows are
invitations to treat only.
3. Invitations to tender
4. Auctions
5. Websites displaying goods
What are the four rules in relation to acceptance? - accurate answers-(1)
Acceptance must be in response to the offer.
Only the person / people to whom the offer is made can accept the offer.
(2) Acceptance must be unqualified and must correspond exactly with the
terms of the offer: the mirror image rule.
(3) Prescribed mode of acceptance
(4) Acceptance must be communicated. The general rule is that acceptance is
effective from the time its communicated to the offeror. Where the offeree
merely intended to accept, but did not communicate that intention to the
offeror, there is no contract.
Q1. In situations where the offeror exclusivley prescribes a mode of
acceptance and excludes other mdoes, how will this effect acceptance of the
offer?
